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Thursday, 27 August 2009

Take a risk? First litigate, then choose your mate

The Tech Transfer Blog is not a place you'd usually look for a discussion of patent litigation issues but, from that very source, here's an article called "Patent litigation: Sometimes it’s a risk worth taking". This post, in relevant part, reads as follows:

"If there was any doubt about a jury’s willingness to take patent infringement seriously, the record $1.67 billion verdict returned against Abbott Laboratories in early June [noted here by PatLit] should go a long way toward erasing such concerns. ... Abbott has appealed the decision, but legal experts suggest that the huge jury award could make TTOs and other patent holders more inclined to take the offensive when they believe their IP has been infringed. “This demonstrates that juries are not averse to awarding very substantial sums when there is a clear instance of infringement,” stresses Brian O’Shaughnessy, an attorney with Buchanan Ingersoll & Rooney, PC, in Alexandria, VA. “Some people are wondering whether or not patents are coming in disfavor, either from the legislative point of view or the public perception point of view. I think this proves the public recognizes that innovation is important and should be protected. [This looks like a very large conclusion to draw from one jury's award, particularly since we're not told if they were asked whether they thought this was so].”

Still, there is no denying that deciding whether to go forward with infringement litigation should be prefaced by careful review of the case and the potential costs that are likely to be involved. And then the real gut question needs to be answered: Do you and your institution have the resources and the resolve to stay with a case that may well drag on for years? Many legal experts agree that there are times when large research universities, in particular, need to stand their ground. “If a research university believes in amassing a significant patent portfolio, then that university will almost certainly need to establish that it has the staying power to enforce its patents in litigation or it may have difficulty getting fair value for its patents,” [this is a similar principle to "if you can't afford the petrol, don't buy the car" -- but there is a difference. All cars need fuel, but most patents remain uninfringed] according to Edward Poplawski, partner and head of the West Coast intellectual property and technology practice at Sidley Austin, LLP in Los Angeles. Universities are almost always inclined to try to settle a dispute before heading to court, but TTOs engaged in this process need to understand that companies often take advantage of this inclination. “There is no question that sometimes with patent litigation as in war, the war of attrition can be advantageous. And just by running out the clock and running up the costs, [patent litigation] can become very, very unpalatable, particularly for universities,” stresses O’Shaughnessy. “It is not for the faint of heart, and it is not for people who are looking for a quick payoff.” [Fortunately, most lawyers don't fit that description. Unlike many of their clients ...]

Many smaller colleges and universities as well as institutions that are new to the tech transfer arena are more inclined to focus on taking defensive measures on the front end of the patenting process than they are on launching litigation. “We work with patent attorneys and inventors to make sure that the claims we are writing in our patent applications are broad enough so that if we ever do find a competitor who is potentially infringing, we can get to the proof of that,”[That's a tough one to call, though: the broader the claim, the greater the risk of a challenge to the claim itself, putting the university back on the defensive] explains Lisa Goble, acting director of the Office of Technology Transfer at the University of North Carolina-Greensboro. A case of potential infringement has not yet arisen at the school, but Goble suggests that if such a case were to occur she would first look into opportunities for potential partnership with the infringer. “Rather than burning bridges, I’d rather build one. And if there is an opportunity where the infringers could be engaged so that it would be easy for them to continue their work and also benefit the university, that is the path I would try.”[In other words, for non-trading bodies stuffed with academic researchers, the patent infringement suit is just part of the courtship ritual leading to a licence"

The Tech Transfer Blog adds that a detailed article on the pros and cons of infringement litigation appears in the August issue of Technology Transfer Tactics (click here for subscription information).